GLOBAL STRATEGIC MARKETING MANAGEMENT

NGUYEN HOANG TIEN DINH BA HUNG ANH GLOBAL STRATEGIC MARKETING MANAGEMENT NGUYEN HOANG TIEN DINH BA HUNG ANH GLOBAL STRATEGIC MARKETING MANAGEMENT Warsaw 2017 Dr Nguyen Hoang Tien wrote chapters: I, III, IV, V and VI Dr Dinh Ba Hung Anh wrote chapter II © Copyright 2017 by Wydawnictwo EMENTON Issue I, Warsaw 2017 All rights reserved Any fragment of this book may not be reproduced, copied or saved in processing systems or any other form using mechanical and electronic devices or others without permission of the publisher ISBN 978-83-65009-22-7 Publisher: Wydawnictwo EMENTON ul Płocka 40 lok 11 01-173 Warszawa e-mail: biuro@ementon.pl www.ementon.pl Printing and binding: Drukarnia cyfrowa ELPIL ul Artyleryjska 11, 08-110 Siedlce tel.: (25) 643-50-42, fax: (25) 643-43-46 e-mail: info@elpil.com.pl www.elpil.com.pl THIS BOOK IS DEDICATED TO NGUYEN THANH VINH BORN IN 04.02.2016 Table of contents Foreword 11 Chapter I INTRODUCTION TO GLOBAL MARKETING 13 I.1 MARKETING AND MARKETING CONCEPT 13 I.1.1 Defining Marketing 13 I.1.1.1 Marketing 13 I.1.1.2 Marketing Management 18 I.1.2 The Marketing Concept 20 I.2 MARKETING STRATEGY AND MARKETING MIX 24 I.2.1 Marketing Strategy 24 I.2.1.1 Internal Factors 26 I.2.1.2 External Factors 27 I.2.2 Target Markets and Marketing Mix 46 I.2.2.1 Target Market 46 I.2.2.2 Marketing Mix 47 I.3 MANAGEMENT ORIENTATION TO GLOBAL MARKETING 52 I.4 GLOBAL MARKET AND GLOBAL MARKETING 54 I.4.1 Global Market 54 I.4.2 Global Marketing 57 I.4.2.1 Global Marketing Issues 58 I.4.2.2 Global Marketing Practices 62 I.5 GLOBAL MARKETING IN SUPPLY CHAIN MANAGEMENT 64 Chapter II MARKET RESEARCH METHODS 71 II.1 MARKET RESEARCH PROCESS 71 II.1.1 Market Research and Marketing Research 71 II.1.2 Market Research Process 75 II.2 PRIMARY AND SECONDARY RESEARCH 81 II.2.1 Primary or Secondary Research 81 II 2.2 Sources of Data for Research 83 II.2.3 Primary Research Techniques 83 II.3 SAMPLING AND INCREASING RESPONSE RATES 90 II.4 RELIABILITY AND VALIDITY OF RESEARCH 94 II.5 ETHICAL ISSUES OF RESEARCH 95 Chapter III MARKET ENTRY STRATEGIES 98 III.1 BARRIERS OF MARKET ENTRY 98 III.2 INDUSTRY ANALYSIS 106 III.3 MARKET ENTRY STRATEGIES 114 Chapter IV STRATEGIC MARKETING MANAGEMENT 124 IV.1 STRATEGIC PLANNING 124 IV.1.1 Strategic Management 124 IV.1.2 Strategic Planning 126 IV.1.3 Different Levels of Strategy 129 IV.2 KEY CONCEPTS OF STRATEGIC PLANNING 132 IV.3 PROCESS OF STRATEGIC PLANNING 138 IV.4 STRATEGY IMPLEMENTATION AND CONTROL 151 Chapter V SEGMENTING, TARGETING, POSITIONING 155 V.1 CONSUMER MARKET AND ORGANIZATION MARKET 155 V.1.1 Consumer Market and Organization Market 155 V.1.2 Consumer Demand and Organization Demand 158 V.2 CONSUMER BEHABIOR AND BUYING DECISION 159 V.2.1 Consumer Buying Behavior 160 V.2.2 Consumer Buying Decision Process 160 V.2.3 Factors Affecting Consumer Buying Decision Process Motives 162 V.3 ORGANIZATION BEHAVIOR AND BUYING DECISION 167 V.3.1 Organization Buying Behavior 167 V.3.2 Organization Buying Decision Process 168 V.3.3 Factors Affecting Organization Buying Behavior 170 V.4 SEGMENTATION, TARGETING, POSITIONING 170 V.4.1 Market Segmentation 170 V.4.2 Market Segments Targeting 180 V.4.3 Positioning on Targeted Market Segments 182 V.4.4 Marketing Mix and Positioning 184 Chapter VI SERVICE MARKETING 188 VI.1 CHARACTER OF SERVICE MARKETING 188 VI.2 SERVICE MARKETING MIX 193 VI.2.1 Product 193 VI.2.1.1 Product Life Cycle 195 VI.2.1.2 Role of Product in Service Marketing 195 VI.2.1.3 Product Strategy 196 VI.2.1.4 Branding 198 VI.2.2 Price 200 VI.2.2.1 Pricing Techniques 201 VI.2.2.2 Market Entry Pricing Strategies 202 VI.2.3 Place 204 VI.2.4 Promotion 206 VI.2.4.1 AIDA Model 207 VI.2.4.2 Promotion mix 210 VI.2.5 Physical Evidence 217 VI.2.6 Process 217 VI.2.6.1 Pre-service Process 219 VI.2.6.2 In-service Process 221 VI.2.6.3 Post-service Process 222 VI.2.7 People 222 VI.2.7.1 People Strategy Mix 224 REFERENCE 237 LIST OF ILLUSTRATIONS 241 LIST OF TABLES 243 makes them act in ways that further the achievement of the objectives of both the organization and themselves Employee Engagement means putting discretionary work effort beyond the minimum to get the job done, in form of extra time, brainpower or energy Discretionary behavior is the choice that people often have on the way they the job and the amount of effort, care, innovation and productive behavior they display There is a close link between high levels of engagement and positive discretionary behavior Positive discretionary behavior is more likely to happen when people are engaged with their work Engaged employees are aware of business context, and work closely with colleagues to improve performance within the job and workplace for the benefit of the organization In general engaged employee: is positive about the job (1); identifies with the organization (2); works actively, performs more effectively (3); helps, treats others with respect (4); goes beyond the requirements of the job (5); keeps up to date with developments in the field (6); looks for opportunities to improve performance (7) Knowledge Management strategy (GPS6 – KMS) Knowledge explicit is codified, recorded, available, held in databases This sort of knowledge is carefully codified and stored in databases to be accessed easily by anyone in or out of organization using Information Technology Knowledge tacit exists in people’s minds and acquired through personal experience: expertise, know-how, business insights and judgment This sort of knowledge is closely tied to person and shared mainly through direct personal contacts by means of informal conferences, communities of practice, workshop, brainstorming and one-toone sessions 230 Knowledge Management is a process of creating, acquiring, sharing and using knowledge to enhance learning and performance in organizations Knowledge Management allows companies to capture, apply and generate value from their employees’ creativity and expertise It is concerned with both stocks and flows of knowledge Stocks included expertise and encoded knowledge in computer systems Flows represent the ways in which knowledge is transferred from people to people or from people to a knowledge database Knowledge Management strategy aims at capturing collective expertise and distribute it to where biggest payoff can be achieved Source of competitive advantages lies not in the market but within the firm, i.e capability to gather, lever and use knowledge effectively There are two approaches toward Knowledge Management strategy: codification strategy related to explicit knowledge management and personalization strategy related to tacit knowledge management Employees Resourcing strategy (GPS7 – ERS) Employees Resourcing strategy is concerned with ensuring that the organization obtains and retains the people it needs and employs them efficiently It is a key part of the strategic human resource management process, which is fundamentally about matching human resources to the strategic and operational needs of the organization and ensuring the full utilization of those resources It is concerned not only with obtaining and keeping the number and quality of staff required but also with selecting and promoting people who fit the culture and the strategic requirements of the organization Employees Resourcing strategy exists to provide the people with skills required in a bid to support the business strategy; but they should also contribute to the formulation of that strategy Human Resource directors have an obligation to point out to their colleagues the 231 human resource opportunities and constraints that will affect the achievement of strategic plans Employees Resourcing strategy is not just about recruitment and selection It is concerned with any means available to meet the needs of the firm for certain skills and behaviors A strategy to enlarge the skill base may start with recruitment and selection but would also extend into learning and development to enhance skills and modify behaviors, and methods of rewarding people for the acquisition of extra skills Performance management processes can be used to identify development needs and motivate people to make the most effective use of their skills In order to guarantee a success of the Employees Resourcing strategy managers should avoid the following negative effects: Lack of group cohesion; Conflict with managers and supervision; Recruitment, selection rapid turnover; Over-marketing And also managers should pursue the following things to enable organization to make the best use of people and adapt swiftly to changing circumstances: Segregate the workforce into a core group and one or more peripheral groups; Outsourcing; Encourage multiskilling to increase the ability of people to switch jobs or undertake any of the tasks possible Talent Management strategy (GPS8 – TMS) Talent is an individual who can make a difference to organizational through immediate contribution or by demonstrating the highest potential Talent Management is a process of identifying, recruiting, retaining and developing talented people It is related with more comprehensive and integrated activities to secure the flow of talent in an organization, bearing in mind that talent is a major corporate resource Talent management starts with the business strategy and what it signifies in terms of the talented people required by the organization Ultimately, its aim is to develop and maintain a pool of talented people Its elements are: 232 Attraction and retention policy; Talent audit; Talent relationship management; Performance management; Learning and development; Career management A Talent Management strategy consists of a view on how the processes described above should mesh together with an overall objective, to acquire and nurture talent wherever it is and wherever it is needed by using a number of interdependent policies and practices The development and implementation of a Talent Management strategy requires high-quality management and leadership from the top and from senior managers and the Human Resource function The approaches required involve emphasizing growth from within, regarding talent development as a key element of the business strategy, being clear about the competencies and qualities that matter, maintaining well-defined career paths, taking management development, coaching and mentoring very seriously, and demanding high performance Learning and Development strategy (GPS9 – LDS) Learning and Development strategy is to ensure that the organization has the talented and skilled people who are given opportunities to enhance their knowledge, skills and competency; and is concerned with developing an organizational learning culture and individual learning Learning and Development strategy embrace:  Learning – relatively permanent change in behavior as a result of practice and experience Learning is the major process of human adaptation Learning is a process by which a person constructs new knowledge, skills and capabilities;  Training – the planned and systematic modification of behavior through learning events, programs and instruction that enable individuals to achieve the levels of knowledge, 233 skill and competence needed to carry out their work effectively Training is one of several responses an organization can undertake to promote learning;  Development – the growth or realization of a person’s ability and potential through the provision of learning and educational experiences;  Education – the development of the knowledge, values and understanding required in all aspects of life rather than the knowledge and skills relating to particular areas of activity Learning Culture is one in which learning is recognized by top management, line managers and employees generally as an essential organizational process to which they are committed and in which they engage continuously A learning culture encourages employees to commit to a range of positive discretionary behaviors, and that has the following characteristics: empowerment instead of supervision, selfmanaged learning instead of instruction, long-term capacity building instead of short-term fixes Organizational Learning is a process of coordinated change with mechanisms built in for individuals and groups to access, build and use organizational memory, structure, culture to develop longterm capacity Learning Organization is an organization which continually expands to create its future; continually improves by rapidly creating and refining the capabilities required for future success; facilitates the learning of all its members and continually transforms itself Employee Rewarding strategy (GPS10 – ERW) Reward strategy is an organization’s declaration of intent in the longer term to develop reward policies, practices that further the achievement of busi- 234 ness goals and the needs of stakeholders Employee Rewarding strategy provides a sense of purpose and direction and a framework for developing reward policies, practices It is based on the needs of organization and its employees Employee Rewarding strategy may be a broad-brush affair simply indicating the general direction in which it is thought reward management should go Additionally or alternatively, Employee Rewarding strategy may set out a list of specific intentions dealing with particular aspects of reward management (specific reward initiatives)  Broad-brush Employee Rewarding strategy – commit the organization to the pursuit of a total rewards policy The basic aim might be to achieve an appropriate balance between financial and non-financial rewards A further aim could be to use other approaches to the development of the employment relationship and the work environment that will enhance commitment and engagement and provide more opportunities for the contribution of people to be valued and recognized;  Specific reward initiatives – the selection of reward initiatives and the priorities attached to them will be based on an analysis of the present circumstances of the organization and an assessment of the needs of the business and its employees Employee Relations strategy (GPS11 – ERL) Employee Relations strategy defines the intentions of the organization about what needs to be done and what needs to be changed in the ways in which the organization manages its relationships with employees and their trade unions Employee relations strategy should be distinguished from employee relations policies Strategies are dynamic as they pro235 vide a sense of direction and give an answer to the question ‘How are we going to get from here to there?’ Employee relations policies are more about the here and now They express the way things are done around here as far as dealing with unions and employees is concerned Employee Relations strategy is based on the philosophy of the organization on what sort of relationships between management and employees and their unions are wanted and how they should be handled Four approaches to Employee Relations strategy have been identified:  Adversarial – the organization decides what to do, and employees are expected to fit in Adversarial approaches are much less common than in the 1960s and 1970s;  Traditional – management proposes and the workforce reacts through its elected representatives The traditional approach is still the most typical, but more interest is being expressed in partnership approach;  Power sharing – employees are involved in strategic decision making;  Partnership – employees involved in policies, but not have the right to manage A partnership strategy will aim to develop and maintain a positive, productive, cooperative and trusting climate of employee relations 236 REFERENCE Amato L., Wilder R., (2004), ‘Global Competition and Global Markets: Some Empirical Results’, International Business Review, 13(3), pp 401–416 AMS (American Marketing Association), (1985), Chicago, IL Barksdale H.C, Darden B., (1971), ‘Marketer's 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standardization 60 Illustration 16 Environmental approach to global marketing 62 Illustration 17 New market as marketing demand generation 70 Illustration 18 Market research and marketing research 72 Illustration 19 Marketing research and marketing information system (MIS) 74 Illustration 20 M.E Porter’s five force model 106 Illustration 21 Investment, risk, return, control of entry strategies 115 Illustration 22 Strategic marketing management 125 241 Illustration 23 Strategic, tactic and operational planning 129 Illustration 24 Levels of strategy 130 Illustration 25 Business units’ interrelations 131 Illustration 26 Functional strategies’ interrelations 132 Illustration 27 Factors impacting corporate competitive advantage 133 Illustration 28 Process of strategic (marketing) planning 138 Illustration 29 BCG matrix 141 Illustration 30 Ansoff matrix 148 Illustration 31 Strategy realization and control 153 Illustration 32 Buying behavior and decision process 159 Illustration 33 Ansoff's product-market matrix 177 Illustration 34 STP process 178 Illustration 35 Selection of target markets 181 Illustration 36 Product-service continuum 196 Illustration 37 Service model 197 242 LIST OF TABLES Table Exchange relationship 14 Table Global marketing context 19 Table Characteristics of customers’ needs focused marketing 22 Table Customization vs standardization 61 Table Customers’ demands classification 69 Table Characteristics of marketing research 73 Table Roles of marketing information system 75 Table Market research plan 78 Table Collecting information 80 Table 10 Advantages and disadvantages of primary and secondary research 82 Table 11 Probability sampling procedure 92 Table 12 Non-probability sampling procedure 93 Table 13 Positive and negative sides of tariff 100 Table 14 Positive and negative sides of subsidiaries 101 Table 15 Positive and negative sides of quotas 102 Table 16 Positive and negative sides of local content requirement 103 Table 17 Positive and negative sides of standards and regulations 104 Table 18 Positive and negative sides of anti-dumping duties 105 Table 19 Positive and negative sides of non-tariff barriers 105 Table 20 Positive and negative sides of export 116 243 Table 21 Positive and negative sides of licensing 119 Table 22 Positive and negative sides of Joint-venture 121 Table 23 Positive and negative sides of wholly owned subsidiaries 122 Table 24 Advantages and disadvantages of segmentation 173 Table 25 Segmentation criteria for consumer and organization market 176 Table 26 Process of positioning 182 Table 27 Product characteristics 193 Table 28 Same brand name advantages and disadvantages 199 Table 29 Pricing strategy characteristics 200 Table 30 Placement characteristics 204 Table 31 Promotion characteristics 207 244 ... of marketing and marketing management Define the marketing strategy and marketing mix Define global market and global marketing ? ?Global marketing in supply chain management MARKETING AND MARKETING. .. CONCEPT MARKETING STRATEGY AND MARKETING MIX GLOBAL MARKET AND GLOBAL MARKETING GLOBAL MARKETING IN SUPPLY CHAIN MANAGEMENT I.1 MARKETING AND MARKETING CONCEPT I.1.1 Defining Marketing I.1.1.1 Marketing. .. 46 I.2.2.2 Marketing Mix 47 I.3 MANAGEMENT ORIENTATION TO GLOBAL MARKETING 52 I.4 GLOBAL MARKET AND GLOBAL MARKETING 54 I.4.1 Global Market 54 I.4.2 Global Marketing